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Australian Economoy

This paper is about the economic currency trends in Australia. This is for an upper 400 level course so the information and ideas discussed should be at that level. Here is the assignment.

In a short narrative (4-5 pages, at least 1000 words):

* Explain the currency trends relevant to Australia (appreciation vs. depreciation or adjustments in pegged values) (1.5 Pages)
* Describe the theoretical impact of these trends on Australia's import and export sector (1.5 pages), and
* Compare this theoretical impact to actual data; does the data support your theory? (1.5 pages)

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In a short narrative (4-5 pages, at least 1000 words):

* Explain the currency trends relevant to Australia (appreciation vs. depreciation or adjustments in pegged values) (1.5 Pages)
If we examine the currency trends the Australian Dollar had had fallen to less than the 50 US-cents level in early 2001. The RBA decided to protect the Australian Dollar from further fall and purchased 3.6 billion Australian Dollars close to the 50 US cent mark. There are several factors that affect the currency trends in the Australian Dollar, for instance the Bank of England held its last gold auctions on the 5th of March. The Australian Dollar appreciated in value to 52.04 cents and an uptrend began. The next important move was made by the Reserve Bank of Australia which raised the interest rates to curb inflation. The Australian Dollar touched the 57 US cent mark in 2003. Further, in 2004, there was spurt in employment in Australia and the Australian Dollar reached a value of 68 to 70 US cents and in 2005 the Australian Dollar reached a peak of 76 US cents. In 2005, the Australian Dollar traded with 82 percent correlation with the price of copper. The Australian Reserve Bank very sparingly intervenes in the value of the Australian Dollar. In 2005 the Australian Dollar was strongly affected by a record production of gold in the Telfer mine. The industry surplus of $97 billion contributed to the increase in the value of Australian Dollar In addition, the exports of Australia to China increased making China the largest buyer of goods from Australia. Finally, in 2006 the Australian dollar reached a peak of 80 US cents. The commodity sales are expected to touch Australian Dollar 114.6 billion in 2006 which is 55% of the country's exports. Even though the Australian Dollar has climbed up in comparison ...

Solution Summary

This explanation provides you a comprehensive argument relating to Australian Economoy

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